The Gym Group plc

Revenue was GBP 133.1 million, up 10% year on year. Average members were just over 1 million, up 5%, and average revenue per member per month was GBP 22.14, also up 5%. EBITDA less normalized rent was GBP 30.8 million, up 12% or GBP 3.4 million, with EBITDA margin up 0.5 percentage point to 23.1%. Adjusted profit before tax increased 31% to GBP 6.4 million, statutory profit before tax rose 48% to GBP 4.9 million, and free cash flow was GBP 27.7 million, up 10%. Non-property net debt was GBP 58 million and adjusted leverage remained at 1x. For the full year, management expects like-for-like revenue growth of approximately 3%, like-for-like site cost inflation at the lower end of 3%-4%, EBITDA less normalized rent at the top end of the current analyst range of GBP 60.5 million-GBP 62 million, at least 20 new openings, total capital expenditure of GBP 60 million-GBP 65 million, and completion of the GBP 10 million share buyback by year-end.

Will Orr framed the period as continued execution on the company's Next Chapter plan, emphasizing strength in the core estate, accelerating self-funded site rollout, and a larger opportunity set in the U.K. gym market. He highlighted structural growth in high-value, low-cost gyms, rising gym penetration, and emerging tailwinds such as GLP-1 usage and greater demand for strength training. His tone was confident and optimistic, but grounded in disciplined capital allocation and ROIC hurdles.

Luke Tait focused on the company’s conversion of revenue growth into profit and cash, noting that EBITDA LNR rose to GBP 30.8 million, adjusted PBT to GBP 6.4 million, and free cash flow to GBP 27.7 million. He pointed to site costs of GBP 63.7 million, normalized rent of GBP 22.2 million, and central costs below 11% of revenue as evidence of operating leverage and cost control. On capital allocation, he said expansionary CapEx was GBP 18.5 million, maintenance CapEx was GBP 7.1 million, non-property net debt was GBP 58 million, leverage was 1x, and the company has GBP 117 million of committed facilities after increasing facilities by GBP 15 million.

Analysts probed the outlook for enhanced refurbishments, site format and location preferences, rollout timing, pricing headroom, member tenure and volume growth, leverage, and the possibility of another buyback. Management said refurb returns are calculated on incremental EBITDA over incremental CapEx, that the current refurb budget is still guided by 6% of revenue but could rise if 30% ROIC is consistently proven, and that another buyback next year is possible given the enlarged facilities and low leverage. They also said the site pipeline remains strong, with core sites still centered around 14,000-15,000 sq ft urban locations but with flexibility for smaller catchments and larger destination gyms.